Committee advances bill to require insurers to cover medical cannabis; insurers warn of fiscal complexity

House Bill 527, which would require health plans — including private plans, Medicaid and state employee coverage — to reimburse for medical cannabis recommendations, advanced with a do‑pass recommendation from the subcommittee.

Sponsor testimony introduced legal context: medical cannabis is eligible for a gross‑receipts tax deduction and some court opinions treat regulated medical cannabis in New Mexico as the functional equivalent of a prescription. Witnesses for Ultra Health said the Cannabis Regulation Act and New Mexico Court of Appeals rulings have established state policy that distinguishes medical cannabis from illicit drugs.

Insurer representatives opposed the bill on fiscal and operational grounds. Blue Cross Blue Shield’s lobbyist noted medical cannabis remains a Schedule I drug under federal law and is not processed through traditional pharmacy claims systems; they cautioned that mandating coverage could raise premiums, create administrative burdens, and would require guardrails that insurers currently lack. Small‑business representatives said mandating coverage may raise employer premiums and make health insurance less affordable for small firms.

Proponents said workers’ compensation already requires coverage for medical cannabis in New Mexico, and Ultra Health counsel pointed to Court of Appeals precedent. Sponsors moved a do‑pass recommendation; the motion carried by voice vote as recorded in the hearing.

Why it matters: the bill would establish a new reimbursement stream for medical cannabis, raising questions about state Medicaid funding, federal match and new billing mechanisms for a medicine that is not dispensed through pharmacies.